Straight Talk: Social Security
Washington, Mar 15 - "I have been looking at the President's statement on Social Security, and it sounds like he is proposing a significant change to the program. I was especially struck by the quote: "It is proposed that the Federal Government assume one-half the cost of old-age pension plan, which ought ultimately to be, supplanted by self-supporting annuity plans." The President in this case is Franklin D. Roosevelt. The year: 1935. (A quote from a recent speech given by Rep.Michael G. Oxley (R-Ohio))
At first glance, Social Security reform is a complex and multi-dimensional issue. Under the current system, your payroll taxes are immediately used to pay benefits for today's retirees. This "pay-as-you-go" system works when many people are paying in and few are collecting benefits. Such was the case in the 1950's when 16 workers paid into the system for every beneficiary. But today, seniors are living longer and collecting more benefits. As a result, there are fewer workers paying into the system per retiree: 3.3 to be exact. In the future, there will be less than 2 workers per retiree. Under these conditions, the current system simply cannot work.
In 2008, the first Baby Boomers will start collecting retirement benefits. The current surpluses will quickly dwindle and then turn to deficits. By 2018, Social Security will begin paying out more than it collects in taxes. The deficits will grow very large, very fast. If nothing is done, by 2042 benefits must be cut by one-quarter across the board, with more cuts to follow. Instead of cutting benefits by one-quarter, the payroll tax could be raised by one-third. If we continue postponing solutions, our only alternatives will be large tax increases or benefit reductions.
No doubt about it, fixing Social Security is a challenge today, but if we wait it will become a crisis. Baby Boomers will retire, and the system surplus will disappear, and the only option will be a large tax increase or benefits cut.
We, the people, stand at a critical crossroads in shaping the retirement security for all recipients. We must make the system practical for our younger workers and we must keep the promises that were made to our seniors.
Retirement is a right, not a privilege. It is a fundamental principle that Americans have a right to a safe and secure retirement future.
"In their analysis, [Stan] Greenberg and [James] Carville said Democrats have resisted saying there is a problem with Social Security, even though 63 percent of Americans in a recent National Public Radio poll said there was. 'To say there is no problem simply puts Democrats out of the conversation for the great majority of the country that want political leaders to secure this very important government retirement program,' they write. 'Voters are looking for reform, change and new ideas but Democrats seem stuck in concrete.'" (Democratic Strategists Stan Greenberg and James Carville, The Washington Post 3/8/05)
If we all work together, Democrats, Republicans, and Independents, we can perform a great duty: keeping Social Security solvent, giving millions of senior citizens now and in the future, the dignity, security and peace of mind that they deserve.
A retirement nest egg is more important than partisan politics. I don't know the solution but I do know that by working together we can find the answer. We need to have discussions about the trust fund. We need to talk about personal retirement accounts. We need to discuss a better way to save. We need to talk about ownership, returns and benefits. We need to discuss Social Security reform. I will be conducting a "Social Security Listening Tour" throughout the district from March 21-31. We will be holding town meetings in Grants, Belen, Socorro, Truth or Consequences, Las Cruces, Anthony, Deming, Alamogordo, Artesia, Roswell, Lovington, Hobbs, Eunice, Fort Sumner, Santa Rosa, Corona and Ruidoso Downs. I would appreciate your attendance and voicing your views on this very important issue. If you cannot attend, please feel free to write, call or e-mail my district and Washington offices about Social Security reform.